About TVNZ

TVNZ REPORTS 28% INCREASE IN UNDERLYING EARNINGS

Television New Zealand today reported underlying earnings1 of
$12.9 million for the financial year to 30 June 2010, a $2.8
million (28%) increase on the previous financial year.

TVNZ Chief Executive Rick Ellis said today that the company
would be paying a dividend to the Shareholder of $4.87 million, an
uplift on the previous year dividend of $1.47 million.

Mr Ellis said the performance of the company, in the middle of
the media industry's greatest international downturn, had been very
pleasing.

"The hard work of management and staff to respond rapidly to the
downturn in advertising revenue, to reduce costs and maintain
advertising market share have produced this great result."

TVNZ reported total revenue of $355.3 million and advertising
revenue of $284.3 million, a decline of $14.1 million (4.7%) on the
prior year. Share of television advertising revenue held
constant at 60.6%2.

Total operating costs were $342.4 million, a reduction of $32.3
million (8.6%) on the prior year, reflecting the company's
disciplined approach to managing costs.

"Despite the challenging year, the company continued the
implementation of a new sales go-to-market approach, committed to
key strategic digital infrastructure capital investments and
progressed transformational projects focused on delivering ongoing
efficiency gains to the company's operations."

He said highlights of the year included TVNZ programmes making
up 20 of the top 20 most watched by New Zealanders, the launch of
the company's first digital pay TV channel, TVNZ Heartland, on the
SKY TV platform, extending the highly acclaimed TVNZ Ondemand
service to the Sony PlayStation 3 and launching a successful iPhone
news application.

TVNZ is reporting an after tax loss of $26.0 million as a result
of two non- recurring accounting adjustments. They are a change to
the expensing of programme stock to accelerate the period over
which the cost is recognised that has resulted in a one-off charge
of $26.8 million, and the impact of the Government's recently
announced changes to income tax legislation including tax
depreciation of buildings which resulted in a one-off charge of
$14.2 million. These non-cash adjustments were excluded from the
results when the Board declared the dividend from this year's
operating results3.

Mr Ellis said continued structural changes in the industry and
uncertainty over the economy would still challenge all media
companies in FY2011.

"While TVNZ has adapted to the new digital era better than most,
the economic recovery remains patchy. The company needs to continue
to be mindful of costs but also not be afraid to continue with its
strategy of transformation and diversification.

"The company has come through the recession well and is
cautiously optimistic about the year ahead."

The Annual Report is expected to be tabled in Parliament in
early October.